Tuesday, October 29, 2013

Over the
next several weeks, the Brennan Center for Justice at NYU School of Law
will send regular updates to this list of Friends of Reform in New York State
on efforts to secure comprehensive campaign finance reform centered on public
financing of elections. These updates will be sent to good government
advocates, allies of the Fair Elections New York campaign, legislative and
opinion leaders, scholars and engaged students, reporters, and other advocates
for reform. They will also be posted on the Brennan Center’s New York blog
at ReformNY.blogspot.com.

Last night’s
Moreland Commission hearing focused on two main topics: the New York State
Board of Elections’ failure to effectively enforce state election
law and the success of public campaign financing systems in New York City and
Connecticut. The first topic – the weaknesses of BOE enforcement practices,
which were already well known – got most of the attention at the hearing and in
the press. The equally important second topic – how we start to address the
corrupting influence of big, special interest money in New York politics – was
almost entirely ignored.

As they grilled
BOE officials, the commissioners’ scathing questions revealed widespread
problems with the agency’s current practices. Those questionable policies
include refusal to investigate anonymous complaints, even those supported by
documentary evidence. Commissioners also questioned the notorious LLC loophole
that allows an individual or company to give many times the contribution limit
through the use of shell companies. In a distressing example of the BOE’s
impotence, the commissioners learned about one investigator, who after failing
to receive work from his supervisors despite repeated requests for more to do,
resorted to playing solitaire on his computer – as a
backlog of hundreds of complaints awaited action.

Advocates of
reform anticipated the hearing would examine not just bureaucratic incompetence
or illegal activity, but also promising solutions to New York’s glaring
campaign finance problems. Witnesses presented testimony in person and in
writing about the highly successful enforcement systems in New York City and
Connecticut, both of which include public campaign financing, which could serve
as a model for New York State.

New York
City Campaign Finance Board Executive Director Amy Loprest submitted testimony discussing the ways that public
financing improves enforcement. Candidates cannot take public funds unless the
CFB’s audits and investigations establish that they are in compliance with the
election laws. She wrote, “Candidates in New York City know that their campaign
will be held to strict standards – and that their opponent’s campaign will be
held to the same standards.”

Campaign
Finance Institute Executive Director Michael J. Malbin, a nationally recognized campaign finance
expert, submitted testimony detailing the financial aspects of a
public funding system. Public funding would cost each New Yorker $2.12 per year
and could save the state millions currently spent on special interest
provisions large campaign donors currently secure for themselves. Professor
Malbin highlighted the urgency: candidates need an alternative to being
overwhelmed by large outside spending that threatens to become the new normal. Public funding “should be included in the Governor’s
executive budget in January 2014.”

The New York
Times’ Michael Powell reveals shocking examples of big campaign donors’
ability to buy legislative influence – and the corruption is completely legal.
A tobacco wholesaler gave large contributions to legislators working on a bill
that would increase his profits; meanwhile New York State ignores a reform that
would increase tobacco tax collections enough to pay for public financing many
times over.

Karen Dewitt of
New York State Public Radio reports on new Common Cause research raising
suspicions of legal corruption. Common Cause hopes the Moreland Commission will
investigate whether “there’s a link between the $5 million dollars spent
by major pharmaceutical companies on lobbying and campaign donations to New
York State politicians, and the failure to pass major consumer friendly
bills regulating Big Pharma.”

New York Daily News columnist Bill Hammond
notes that the structure of the Board of Elections impedes its work. Since the
commissioners and even the staff are split evenly between Democrats and
Republicans, each party can veto decisions it regards as disadvantaging its
side.

Monday, October 28, 2013

Over the
next several weeks, the Brennan Center for Justice at NYU School of Law
will send regular updates to this list of Friends of Reform in New York State
on efforts to secure comprehensive campaign finance reform centered on public
financing of elections. These updates will be sent to good government
advocates, allies of the Fair Elections New York campaign, legislative and
opinion leaders, scholars and engaged students, reporters, and other advocates
for reform. They will also be posted on the Brennan Center’s New York blog
at ReformNY.blogspot.com.

At this hearing
the Moreland Commission will investigate current problems with campaign finance
enforcement and hear about successful reforms in New York City and Connecticut.
Unlike New York State, Connecticut and New York City have strong enforcement
agencies created in response to public corruption crises. Both enforcement
agencies are strengthened by public campaign financing systems: When
disbursement of public funds is conditioned on compliance with campaign finance
laws, candidates have a powerful incentive to stay in line.

While the
hearing will necessarily emphasize the failure to enforce New York State’s
current campaign finance laws, it would be unfortunate if that was the sole
focus. In Albany the real scandal is what is perfectly legal. Contribution
limits are sky-high and full of loopholes, disclosure requirements are lax, and
a pay-to-play culture rewards the biggest campaign contributors while locking
ordinary citizens out of the political process. If tonight’s hearing focuses
only on high-profile bribery cases or how much money is in the Board of
Elections’ budget, the Moreland Commission will have lost a crucial opportunity
to examine changes that can profoundly transform Albany.

We are hopeful
that commissioners will devote the necessary time and attention to these
topics:

The adequacy of the State Board of Elections’ current
report filing schedule (January, July, and a few times during the fall),
which limits the contribution information available during the legislative
session.

The adequacy of current State Board of Elections rules
governing disclosure of independent expenditures, which is limited to
express advocacy.

The high rate at which candidates from both parties
participate in New York and Connecticut’s public funding systems, and the
reasons for that success.

The ways that public campaign financing and effective
enforcement support each other, through both powerful financial incentives
and meaningful transparency.

How public funding allows candidates to respond to
independent expenditures.

The Moreland
Commission will issue its first report in the beginning of December.

Testimony to the Moreland Commission. Brennan Center Deputy
Director Lawrence Norden’s updated testimony discussing tax credits for major
political donors that have been repeatedly reauthorized by the legislature
without any substantive, public analysis as to whether such tax breaks should
be made permanent or eliminated.

Friday, October 25, 2013

The Brennan Center regularly compiles the latest news concerning
the corrosive nature of money in New York State politics—and the ongoing need
for public financing and robust campaign finance reform. We’ll also be linking
to dispatches from around the country highlighting the national scope of this
crisis. This week’s links were contributed by Syed Zaidi and Katherine Munyan.

A Federal Appeals Court has granted
preliminary injunction to a conservative political action committee seeking
to accept contributions of more than $150,000 from individual donors. The New
York Progress and Protection PAC filed
an emergency appeal to the Second Circuit Court of Appeals after a District
Court denied its request. New York law imposes an aggregate cap of $150,000 on the
contributions an individual may make to all candidates and political committees
within a year. While New York Progress and Protection PAC can immediately start
accepting and spending unlimited sums, a
decision regarding the broader question – the constitutionality of New York
State’s aggregate contribution limit on donations to independent committees –
has yet to be rendered. However, in their verdict on the preliminary
injunction, the appellate judges noted
that NYPPP’s arguments had a “substantial likelihood of success.” Lawrence
D. Norden, the deputy director of the Democracy Program at the Brennan Center,
said that “If this decision holds, there should be real concern that what we’re
going to end up with in New York State is what we have on the federal level,
which is candidates being sponsored like racehorses by very wealthy
individuals.”

Siena Poll: Voters Think Corruption is a Serious Problem

In the latest Siena
Research Institute Poll of registered voters in New York, a large number of
citizens indicated their frustration with business-as-usual politics in Albany.
When asked if they find corruption in the New York State legislature to be a
serious problem, 82 percent said that it is a “very serious” or “somewhat
serious” issue. This figure includes large majorities
across all demographics including political party affiliation, region, race
and income. Seventy-two percent of New Yorkers think that the Moreland
Commission, which was appointed by the governor following the legislature’s
failure to pass any anti-corruption bills, should
continue investigating political corruption rather than propose a
constitutional amendment and disband. Again support was strong, at least 70
percent, among most of the groups surveyed. Voters said that Governor Cuomo,
Attorney General Schneiderman and federal prosecutors are doing
the most to address corruption and that the state legislature is doing the
least.

For years, the Niagara County Legislature opposed CWM
Chemical Services’ request for the expansion of a hazardous waste landfill in
Porter, New York. But recently, the County may have had a change of heart; it has
failed to renew
a contract with Gary A. Abraham, an Allegany attorney who had represented
the County in litigation surrounding the landfill. Residents for Responsible
Government (RPG), an environmental group, distributed handouts at a press
conference showing that CWM Chemical Services and its parent company have
donated $71,750 to the Niagara County GOP Committee, the Niagara County
Conservative Party, and the Town of Porter Republican Committee, based on state
Board of Election records. Republicans currently control the Niagara County
Legislature. A resolution sponsored by County Legislators William L. Ross
(C-Wheatfield) and Clyde L. Burnmaster (R-Ransomville) that would extend the
attorney’s contract was not voted upon but instead sent to the Administration
Committee for further study. RPG members and some residents fear the delay may
make it more difficult to address their case before upcoming
state Department of Environmental Conservation hearings on the landfill expansion.
“Any day the DEC could come out and say this is when the process starts and,
right now, the people in Niagara County have no one to represent them,” RRG
president April Fideli said.

Democrat & Chronicle Tells Corruption Commission to
Press On

Following reports that the Moreland Commission to
Investigate Public Corruption was shying away from examining legislators and political
parties, newspapers across
the state penned editorials pressing
the commission to move forward with its badly-needed work. This week, the Democrat
& Chronicle insisted that in order for the panel to meet its obligation
of investigating potential instances of corruption, it must have wide latitude
to do its job. Albany lawmakers, who are allowed to work outside of the
legislature part of the year, have thus far refused to turn in records about income
derived from such activities. The commission’s concern stems from the potential
for conflicts of interest. Encouraging the immediate disclosure of this information,
the editorial said that, “The honest ones have no reason to do otherwise.”

On Thursday, the California Fair
Political Practice Commission (FPPC) announced a fine
of $1 million against two out-of-state nonprofits for campaign finance law
violations. In the 2012 election, the
Arizona-based Americans for Responsible Leadership and Center to Protect
Patient Rights funneled
$11 million into a campaign to defeat a ballot measure to raise taxes and
to support a ballot measure to weaken union political power. Both nonprofits kept their donors secret, in
violation of a California law that requires nonprofits to disclose their donors
if their contributions were intended for a state campaign. After a legal battle, Americans for
Responsible Leadership did name its donors—but only as other
nonprofits. The disclosure hid the original
contributors, but revealed a shadowy network of nonprofits funneling anonymous
donations around the country, with ties
to the Koch brothers. In addition to the
fine, FPPC will require two California groups to hand over to the state the more
than $15 million in secret donations they received. Meanwhile, in the 2012
elections, the governor’s tax proposal passed and the proposal restricting
union activity failed, leaving even local conservative groups describing the
out-of-state money as a harmful distraction
from their cause.

Outside Spending Heating Up for 2014 Kentucky Senate Race

Senate Minority Leader Mitch McConnell (R-Ken.) will be up
for reelection in 2014 in a contest that is already attracting national
attention—and national money. Outside
interest groups are jumping at the chance to unseat or support the party leader. They have already spent
$2.2 million in advertisements, more than a year ahead of the election. The
spenders include both nationwide groups that will be active in elections across
the country and groups formed to back a single candidate. McConnell’s Democratic
opponent, Kentucky Secretary of State Alison Lundergan Grimes, raised
$2.5 million in the third quarter.
Her contributors include Kentucky Democrats as well as national figures,
such as George Soros and numerous Hollywood donors. Mitch McConnell raised $2.3
million in the same period, as he also prepares for a primary challenge
from Tea
Party opponent Matt Bevin. Early
spending is fueling estimates that the final tally for the 2014 election may
reach $100
million.

Lobbying Activity Declines This Year, with a Few Big
Exceptions

Of last year’s top 100 lobbying entities, more than
two-thirds spent less
on lobbying during this year’s third quarter than they did in last year’s. These companies span numerous industries, and
include General Electric, the National Association of Realtors, the American
Hospital Association, and defense firm Lockheed Martin. However, pharmaceutical companies, gun issue
advocates, and corporate agriculture interests are all outliers in this trend,
increasing their spending this year. With the House and Senate preparing to
negotiate a farm
bill next week, lobbying efforts are intensifying for farm, anti-poverty,
budget watchdog, and trade groups.
Facebook and Twitter also have increased
their lobbying presence this year. Silicon Valley groups are also beginning a
lobbying push for immigration
reform.

Friday, October 18, 2013

The Brennan Center regularly compiles the latest news
concerning the corrosive nature of money in New York State politics—and the
ongoing need for public financing and robust campaign finance reform. We’ll
also be linking to dispatches from around the country highlighting the national
scope of this crisis. This week’s links were contributed by Syed Zaidi and
Katherine Munyan.

Moreland Commission Will Issue Subpoenas to Legislators,
Political Parties

The Moreland Commission to Investigate Public Corruption
said Tuesday that it will issue
subpoenas to lawmakers mandating disclosure of their outside income. New
York State legislators are allowed to hold positions outside of public office
during part of the year. The commission’s
request earlier this year that the information be voluntarily released was
rebuffed by lawyers representing state legislators. “In addition to the
investigation into the legislature, the Moreland Commission has moved to look
across the board at all housekeeping accounts,” commission spokeswoman Michelle
Duffy informed the press. “Housekeeping”
accounts may only be used for party-building and administrative costs, and
there is no limit on the amount that individuals may donate to them. Reform
groups however, argue that housekeeping accounts frequently serve as a conduit
to transfer funds to party-favored candidates, circumventing state contribution
caps. For example, a Common Cause investigation demonstrated that the Senate
Republican Party transferred $211,000 to the state Independence Party last
year, which was ultimately spent on attack ads against Democrats. State
Attorney General Eric Schneiderman has emphasized
the importance of independence for the commission and instructed his staff
to help the commission accomplish “whatever the commissioners want. Period.”

Buffalo News: Corruption Commission Should Remain
Independent

Following allegations
that the Moreland Commission to Investigate Public Corruption was being
pressured by Governor Cuomo’s office to forgo certain investigations, the Buffalo
News penned an editorial emphasizing the need for the commission to remain
independent. The governor’s office has denied the claims of interference,
stating that it has regular meetings with the commission but does not exercise
inappropriate influence. Meanwhile, as of last week, legislators were still
resisting the commission’s request
for information regarding outside income. A subpoena drafted by the
commission to examine contributions by the Real Estate Board of New York was
never sent out, but commissioners have urged REBNY to turn
over the information voluntarily or face a subpoena. Campaign finance
reports of all state lawmakers, the editorial argues, should be scrutinized by
the commission to examine and expound upon potential instances of corruption. The
editorial was adamant in driving home this point: “Given the Legislature’s
opposition to clean living, an independent investigation is the only way to
go.” New recommendations can only be formulated after wrongdoings are examined
and publicized.

Earlier this year, Albany legislators approved constitutional
amendment language that would allow casino gambling in New York, sending the
issue to the voters in a referendum
to be decided this November. Currently New York permits gambling at five
Native American-run casinos and electronic gambling at nine racetracks. The constitutional
amendment, if it passes, would allow up to four new casinos in the Catskills,
Southern Tier and Albany County regions. According to analysis by Common Cause
New York, gambling and horse racing interests have spent $59 million on
lobbying and political contributions in the state since 2005. And in just May
and June of this year, the industry spent more than $1 million on lobbyists. Susan
Lerner, executive director at Common Cause New York, said that “Albany is extra
skilled in creating opportunities for the gambling industry to throw money at it.”
Opponents of the measure have expressed concern about the language
on the ballot, which was changed
to describe supposed benefits such as “promoting job growth, increasing aid to
schools and permitting local governments to lower property taxes.” Concerned
citizens have argued that the language was deliberately changed to incline
voters to approve the proposed constitutional amendment and question the
likelihood of such positive results. A prior effort to legalize gambling in New
York was defeated
in 1997 by an unexpected coalition between faith leaders and Donald Trump,
although that proposal never made it to the referendum stage.

NATIONAL

McCutcheon Decision May Affect State Laws

Last week, the Supreme Court heard
arguments in McCutcheon v. FEC on the constitutionality of federal
aggregate limits on campaign contributions to federal candidates and parties,
which require individuals who have given a certain amount to stop giving altogether
for the rest of the election cycle.
States with similar limits on state candidate contributions are watching
closely. Only nine states have aggregate
limits on campaign donations. A case
challenging Wisconsin’s limits is already pending in the federal courts.
Wisconsin law sets an aggregate limit of $10,000 per year on individual
donations to state-office candidates, political parties, and PACs. In U.S. District Court, Wisconsin
resident—and Koch brothers associate—Fred Racine, Jr. is fighting to strike
down those limits. Another case is
pending challenging
campaign finance laws in Hawaii, including donation caps, reporting rules,
and a ban on government contractors donating to candidates. The 9th Circuit has
already heard arguments in the case, but suggested it may delay ruling until
the Supreme Court rules on McCutcheon.

Washington State Sues Food Lobbyists over Campaign Finance
Law Violations

On Wednesday, Washington State Attorney General Bob Ferguson
filed
suit against the Grocery Manufacturers Association (GMA) over state
campaign disclosure laws. According to
Ferguson, the GMA, a Washington D.C.-based trade association, illegally
collected and spent more than $7 million without
disclosing its contributors. The GMA became involved in Washington State to
oppose an upcoming ballot initiative, I-522, that would require the labeling of
genetically modified food and has become one of the state’s costliest
initiative campaigns ever. The attorney general’s office is requesting the
court to mandate that GMA immediately
comply with disclosure requirements.
The GMA denies that it is in violation of state campaign finance laws.